Entourage Health Corp. (OTCQX:ETRGF) (TSXV:ENTG)(FSE:4WE) released its financial results for the three months ended March 31, 2022, revealing total revenue of $15.8 million, up 17% sequentially over Q4 2021.
Q1 2022 Financial Highlights
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Gross revenue of $17.4 million, and net revenue of $15.8 million less excise tax for total net revenues of $12.4 million compared to $10.6 million for the quarter ended December 31, 2021, a 17% sequential increase and 21% year-over-year improvement.
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Gross profit before changes in fair value was $2.7 million for Q1 2022, representing an increase in profit of $2.5 million or 992% due to improved efficiencies and partly due to lower inventory write-downs in Q1 2022.
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Gross margins of 22% in Q1 2022 compared to (-8%) for Q4 2021 and 2.4% in Q1 2021, the improvement over the prior periods a result of lower cost to produce higher grade products, sold at higher margins across expanded distribution channels.
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Adjusted EBITDA improved by $1.0 million to $563,000 in Q1, 2022, compared with negative $(432,000) in Q4, 2021, also primarily driven by strategic transformation initiatives to lower costs and partly due to generating higher-margin revenue and spending lower selling, general and administrative expenses.
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Loss and comprehensive loss was $8.76 million compared to $44.5 million in Q4 2021.
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Cash and cash equivalents at the end of Q1 were $9.98 million
“Our first quarter results reflect our strongest operating performance to-date – mainly from fulfilling some of the largest purchase orders in our company’s history with exemplary delivery rates while consistently producing higher-grade cannabis at higher efficiencies. All of this contributed to notable increases in our adult-use and medical sales – up over 35% from last year,” stated George Scorsis, CEO and executive chair, Entourage.
“Since implementing our strategic transformation initiatives, we have achieved sequential revenue growth and cost improvements. These initiatives continue to produce tangible benefits, including 22% gross margin expansion during the quarter. With our improved liquidity position and financial flexibility thanks to our expanded credit facilities and lenders’ support, we have the resources to continue creating long-term value for all our stakeholders,” continued Scorsis.
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